5 ms·

Ask HN: Would a cooperative ride hailing model offer a better future?

It sits uneasy with me that the future of humanity is to have large swathes of the population functioning as stimmed up zombies barely making ends meet, while Silicon Valley floats what is essentially an on-demand marketplace at meaningless paper valuations. What is the reason ride hailing apps could not adopt a cooperative driver-owned model? Allegedly, Uber subsidises each trip to the tune of 40%. I imagine this added cost is broadly Uber Operations and tech infrastructure. Without any evidence or analysis, I would guess this was largely necessary to prove the model, fight regulatory barriers, incentivise riders, customer service, reference checking, etc. In fact, I would be interested in a postcard estimate on costs involved for simply keeping the lights on. With the legwork largely complete, and assuming such a service is relatively straightforward to replicate technically, what efficiency does Uber as an entity provde in the marketplace? Could we not evolve to a driver-owned model which employs the necessary technical infrastructure (perhaps opensource or state-owned even) to stay operational, rather than some unicorn chasing self driving fantasy?

narag 7y ago
What is the reason ride hailing apps could not adopt a cooperative driver-owned model? That's what taxis are, at least in Spain. Yes there are license renters that hoard many licenses, but most are individuals, that sometimes associate to share services like call centers or apps. Someone here told me time ago that the service is not straightforward to replicate technically at all.
- mimixco 7y ago
  Uber's app service? As far as apps go, it's very simple.
  - narag 7y ago
    I've tried and failed to find the original comment. There were something about non-obvious matching algorithm and infrastructure needed. I can't see it either...
    - mimixco 7y ago
      You don't need a CS degree to see that it's simple. The Uber app has only a few basic functions: Get the user's GPS location. Get the GPS locations of nearby cars. Pick the closest car. Collect payment. Send a dispatch message to the driver. That's all there is to it!
      - narag 7y ago
        I don't know. But there's some easy reality check. Has it been successfully replicated? At what cost?
        mimixco 7y ago
        A high school student could write the Uber app. Has it been replicated? Of course, by Lyft, for example.
- bitrevolution 7y ago
  I believe the medallion/license models is no longer viable and largely a beuraucratic, obsolete, monopolistic form of rent seeking. And Uber has largely proven this. I am more interested in the technical and financial feasibility of replicating an employee owned ondemand marketplace such as Uber and more generally any service that provides limited efficiency to the end user at an unreasonably high cost to the supplier.
  - deleted 7y ago
    [deleted]
  - narag 7y ago
    I deleted a previous response, now I understand better what you meant. In my humble opinion, it doesn't work. Cooperatives tend to bureaucratic, obsolete, monopolistic forms of rent seeking and then comes some uber and eat them. But that's just like my opinion, really.
mimixco 7y ago
What part would be driver-owned? The elephant in the room here is that the economy of scale from a taxi company comes from owning and maintaining a fleet of cars at a lower cost than a single vehicle owner would pay. If "cooperative" drivers own their own cars, that goes out the window. If they have to be business partners to be "cooperative," that opens a whole can of worms about whom you want to be in business with and how you would make company decisions. The Uber model is nuts; I agree with you there. But, at the end of the day, there wasn't anything wrong with the 100 year old taxi model to begin with.
- bitrevolution 7y ago
  >> What part would be driver-owned? To be clear, I don't propose changes in vehicle leasing/ownership. Indeed, there are economies of scale to be exploited in fleet ownership and that could be ripe for disruption as well. Having spoken to a few Uber drivers I believe they manage their own leasing and insurance expenses. For now, I simply mean the technical infrastructure which allows Uber as the concept of a real-time on demand marketplace to exist and operate. By no means is this limited to Uber only, but in general every new Uber for X type service that pops up.
  - mimixco 7y ago
    Uber spends far more on app development than any taxi company ever spent in radio dispatch. There's no economy there. Uber is a great example of a company that sounds great but, in practice, has no economies to offer. It's worth pointing out here that all other "We're the Uber of n." ideas have failed miserably.
    - bitrevolution 7y ago
      >> Uber spends far more on app development than any taxi company ever spent in radio dispatch. I'm just not sure what there is to continually develop? Thinking of recent new features... UberPool, Multi-Destination Trips? Fine tune the surge algorithm? Some data science insight? http://www.businessofapps.com/data/uber-statistics/ http://www.businessofapps.com/data/uber-statistics/ According to this there's 3.9 million drivers world wide. As I understand it Uber takes 25% per fare. Hypothetically, even with each driver contributing a nominal $1 per day as an "app license" you would amass a reasonable costbase which easily offsets the 25% commission per fare.
naveen99 7y ago
You could start a cooperative ghost restaurant business powered by Uber eats: https://en.wikipedia.org/wiki/Ghost_restaurant https://en.wikipedia.org/wiki/Ghost_restaurant
naveen99 7y ago
I wonder why Uber pool expansion to more cities is so slow.

narag 7y ago

What is the reason ride hailing apps could not adopt a cooperative driver-owned model? That's what taxis are, at least in Spain. Yes there are license renters that hoard many licenses, but most are individuals, that sometimes associate to share services like call centers or apps. Someone here told me time ago that the service is not straightforward to replicate technically at all.

mimixco 7y ago
Uber's app service? As far as apps go, it's very simple.
- narag 7y ago
  I've tried and failed to find the original comment. There were something about non-obvious matching algorithm and infrastructure needed. I can't see it either...
  - mimixco 7y ago
    You don't need a CS degree to see that it's simple. The Uber app has only a few basic functions: Get the user's GPS location. Get the GPS locations of nearby cars. Pick the closest car. Collect payment. Send a dispatch message to the driver. That's all there is to it!
    - narag 7y ago
      I don't know. But there's some easy reality check. Has it been successfully replicated? At what cost?
      - mimixco 7y ago
        A high school student could write the Uber app. Has it been replicated? Of course, by Lyft, for example.
bitrevolution 7y ago
I believe the medallion/license models is no longer viable and largely a beuraucratic, obsolete, monopolistic form of rent seeking. And Uber has largely proven this. I am more interested in the technical and financial feasibility of replicating an employee owned ondemand marketplace such as Uber and more generally any service that provides limited efficiency to the end user at an unreasonably high cost to the supplier.
- deleted 7y ago
  [deleted]
- narag 7y ago
  I deleted a previous response, now I understand better what you meant. In my humble opinion, it doesn't work. Cooperatives tend to bureaucratic, obsolete, monopolistic forms of rent seeking and then comes some uber and eat them. But that's just like my opinion, really.

mimixco 7y ago

What part would be driver-owned? The elephant in the room here is that the economy of scale from a taxi company comes from owning and maintaining a fleet of cars at a lower cost than a single vehicle owner would pay. If "cooperative" drivers own their own cars, that goes out the window. If they have to be business partners to be "cooperative," that opens a whole can of worms about whom you want to be in business with and how you would make company decisions. The Uber model is nuts; I agree with you there. But, at the end of the day, there wasn't anything wrong with the 100 year old taxi model to begin with.

bitrevolution 7y ago
>> What part would be driver-owned? To be clear, I don't propose changes in vehicle leasing/ownership. Indeed, there are economies of scale to be exploited in fleet ownership and that could be ripe for disruption as well. Having spoken to a few Uber drivers I believe they manage their own leasing and insurance expenses. For now, I simply mean the technical infrastructure which allows Uber as the concept of a real-time on demand marketplace to exist and operate. By no means is this limited to Uber only, but in general every new Uber for X type service that pops up.
- mimixco 7y ago
  Uber spends far more on app development than any taxi company ever spent in radio dispatch. There's no economy there. Uber is a great example of a company that sounds great but, in practice, has no economies to offer. It's worth pointing out here that all other "We're the Uber of n." ideas have failed miserably.
  - bitrevolution 7y ago
    >> Uber spends far more on app development than any taxi company ever spent in radio dispatch. I'm just not sure what there is to continually develop? Thinking of recent new features... UberPool, Multi-Destination Trips? Fine tune the surge algorithm? Some data science insight? http://www.businessofapps.com/data/uber-statistics/ http://www.businessofapps.com/data/uber-statistics/ According to this there's 3.9 million drivers world wide. As I understand it Uber takes 25% per fare. Hypothetically, even with each driver contributing a nominal $1 per day as an "app license" you would amass a reasonable costbase which easily offsets the 25% commission per fare.

naveen99 7y ago

You could start a cooperative ghost restaurant business powered by Uber eats: https://en.wikipedia.org/wiki/Ghost_restaurant https://en.wikipedia.org/wiki/Ghost_restaurant

naveen99 7y ago

I wonder why Uber pool expansion to more cities is so slow.